Global trade activity recorded a surprise rebound in the first quarter of 2025 as businesses rushed to move goods ahead of anticipated tariff hikes, but the World Trade Organisation has warned that the momentum may not hold.

According to the WTO’s latest Goods Trade Barometer, seen by The PUNCH, merchandise trade climbed above trend, rising to 103.5 from 102.8 in March.

The agency said the surge was largely driven by importers frontloading shipments in response to growing concerns over new protectionist measures.

“Businesses accelerated import orders to beat expected tariff increases, especially in sectors like automotive products and electronics,” Chief Economist at the WTO, Ralph Ossa, said.

Air freight and container shipping indices hit 104.3 and 107.1, respectively, reflecting a spike in goods movement along key global routes. Automotive products recorded a barometer reading of 105.3, while electronic components stood at 102.0, both benefiting from steady consumer demand and improved supply chain efficiency.

However, the WTO cautioned that the spike may be short-lived. Its index for new export orders, considered the most forward-looking indicator, dropped to 97.9, below the baseline of 100, suggesting a slowdown in global demand.

In its April 2025 Global Trade Outlook and Statistics report, the WTO projected world merchandise trade growth of 2.7 per cent under a low-tariff scenario. However, based on current trade policies, the forecast has been slashed to just 0.1 per cent.

Ossa warned that persistent trade tensions, such as recent US-China and US-UK policy shifts and fresh tariffs on steel and aluminium, could deepen the uncertainty.

“The short-term figures may look encouraging, but the fundamentals remain fragile,” he said.

The WTO’s raw materials index, which hovered around 100.8, also highlighted the fragility of the recovery, barely maintaining trend levels.

Economists say the current pace of trade is unlikely to continue, with the frontloading of goods potentially masking deeper structural weaknesses.

While the strong Q1 performance may offer temporary relief to exporters, officials say it’s not yet a sign of sustained recovery.

“Export growth is softening, and once the frontloaded inventory clears, we may see trade volumes begin to taper off again,” Ossa added.

The global trade body stressed that without clearer trade policy signals and stronger global demand, 2025 could still turn into a challenging year for world commerce.